The former head of a Chicago asset management company pleaded guilty Wednesday to fleecing six union pension funds of $24 million and spending much of the money on jewelry, gambling and renovation of his strip club.
The former head of a Chicago asset management company pleaded guilty Wednesday to fleecing six union pension funds of $24 million and spending much of the money on jewelry, gambling and renovation of his strip club.
John Orecchio, 44, said in a signed plea agreement he also used money that was supposed to be invested on behalf of union members to pay for a horse farm, luxury automobiles and chartered airplane travel.
The jewelry alone was worth more than $1 million, he said. And more than $1.1 million went to what prosecutors called "purported political donations" that had nothing to do with Orecchio's management of the six pension funds.
Judge Harry Leinenweber set June 10 for sentencing. Orecchio could get 15 years in prison under federal guidelines but prosecutors promised to recommend a sizable break if he cooperates as they push ahead with further investigations.
Orecchio was president of Chicago-based AA Capital, a firm that was placed in receivership by the Securities and Exchange Commission in September 2006.
Before that, AA Capital firm invested assets on behalf of 60,000 members of the six locals, mostly based in the Detroit area.
The locals are Carpenters Pension Trust Fund — Detroit & Vicinity; Operating Engineers Local 324 Pension Fund; Michigan Teamsters Joint Council 43 Pension Fund; Millwrights Local 1102 Supplemental Pension Fund, Michigan Regional Council of Carpenters Annuity Fund, and Arkansas/Oklahoma Regional Council of Carpenters.
